[pagebreak:Electrorides Seeks $20M]
Electrorides, which unveiled its electric ZeroTruck prototype at a conference in Las Vegas this week, is seeking $20 million, CEO Tedd Abramson told Greentech Media.
The company was founded with $500,000 of self-funding last year and has only taken money from private individual investors so far (see Pimp My Commercial Truck). But Electrorides is ready to move beyond its bootstrapping phase and is open to different financing opportunities, Abramson said at the Alternative Fuels & Vehicle Conference.
Electrorides plans to use the money to expand its vehicle sales and development, he said, adding that the round would support the company through its fifth year. Abramson said finding the right investors is the company's biggest challenge.
“We want to make it simple: Meet us and listen to our plan,” he said. “We have a good plan, we’re easy to deal with and we have the right team to execute. Are there going to be bumps in the road? Of course. But if you have the right people, you can solve them more easily. Getting the right financial partner is the key – the right investors with the energy that meets our energy.”
The company plans to sell kits to convert the engine in the Isuzu N-Series chassis into an electric powertrain. The kits include a 100-kilowatt electric motor from UQM Technologies (AMEX: UQM) and a 350- to 400-volt lithium-ion polymer battery pack from South Korea manufacturer EIG, as well as parts like cables, brackets and mounts needed to install the system in the truck.
The truck will be able to drive about 100 miles on one charge, and Gordon Vallely, executive vice president, said the company hopes to be able to offer options to extend the range.
Electrorides, which began developing the kits a little over a year ago, said it chose the Isuzu chassis, which customers can pair with different bodies, because the manufacturer has 78 percent of the medium-duty market.
“People know how to repair them and work on them; they feel comfortable,” Abramson said. “We want to make it as simple as possible to own, to operate and to repair.”
On Monday, the day it introduced the ZeroTruck, the company had some 40 to 50 potential customers express “realistic” interest in buying trucks for their fleets, Abramson said.
The company also has selected Boshart Engineering as its engineering firm and LA Freightliner as its distributor, he said at the show, and Supreme Corp. to supply the truck bodies.
The company is testing its prototype now and plans to begin full beta testing in a month to accumulate real-world driving miles for Boshart, Vallely said.
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“We’re excited to get that data back,” Abramson said. “We’ll tighten things here and there, then take receipt of the truck and go on a road show.”
Electrorides hopes to take the truck to potential customers and begin accepting orders in late August or early September, and to deliver its first trucks in the fall, said Abramson, who previously was the founder and owner of American Dream Transportation, which made specialty limousines and luxury buses for its own transportation service in Island Park, N.Y.
The company hasn’t yet settled on a price, but Abramson said that if it ends up around $135,000, customers would see a return on their investment in about six years.
“It’s about $500-per-month difference, so it will be affordable," he said, "and they will recoup their investment in six years -- and not pollute the air.”
Vallely said that payback period doesn’t factor in any renewable-energy credits customers might be able to receive by making the switch.
The company expects to produce 25 to 50 units in 2008 and 100 units or more in 2009, Abramson said.
It is establishing its supply chain now and is nearly finished putting its production partners for the California market in place, he said. It will need suppliers to produce battery brackets and trays, motor mounts, motor-to-transmission coupling and the parts for the vacuum assist, he said.
“We think we know who we’re going to deal with, but we want to get a few other bids to make sure,” Abramson said.
The company also plans to make some proprietary parts for its drive train – mostly software – that it plans to manufacture in-house, and Boshart is selecting a vendor to deliver it according to its specifications.
Once the kits are ready and orders are filled, vehicle owners won’t be expected to install the kits -- which will come in two or three crates -- themselves.
Electrorides plans to train dealers to perform the conversions during a weeklong program. Abramson said that once mechanics complete the training, it will take two people less than a week to convert the trucks after the engine is pulled out.
But will dealers want to make the time commitment, and won’t that labor increase the price of the conversions?
Abramson said dealerships are “very interested” in the kits because gasoline-vehicle sales are down and they are looking at a way to increase their sales.
“We can build a big manufacturing facility and carry those costs and deliver the vehicle to a dealership at a higher cost, or we could take the money we were going to spend and put it into dealer support, training and marketing,” he said. “We wanted to get the vehicles out to the marketplace sooner and have a lower-cost vehicle. Dealerships already have expressed that they like [our choice]. With the downturn in their sales, it keeps their people busy.”
The company is looking for solar companies to package with its ZeroTruck so customers can choose to charge the truck with all-renewable energy to make it as green as possible, Abramson said.
In the future, Electrorides also is looking to move into trucks with heavier vehicle weight ratings, so that customers can extend the range or haul more weight for the same number of miles, he said.